Quarterly report pursuant to Section 13 or 15(d)

Commitments and Contingencies

Commitments and Contingencies
9 Months Ended
Apr. 30, 2016
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

Note 10—Commitments and Contingencies


In the ordinary course of business, the Company may become a party to lawsuits involving various matters. The Company is unaware of any such lawsuits presently pending against it which individually or in the aggregate, are deemed to be material to the Company’s financial condition, or results of operations.


On April 15, 2016, Dr. Robert Pierce notified the Company that he will resign as Chief Scientific Officer of the Company effective June 18, 2016. He will remain an officer and an employee of the Company until that date. Immediately thereafter, Dr. Pierce will transition to the role of Chief Scientific Strategist and continue to support the Company in a consulting capacity. Dr. Pierce and the Company entered into a Separation, Release, and Consulting Agreement (the “Agreement”) on April 15, 2016. Under the Agreement, Dr. Pierce’s employment with the Company, and the Executive Employment Agreement between the Company and Dr. Pierce, will terminate on June 18, 2016. Dr. Pierce will not receive any severance pay from the Company relating to his employment agreement. The Agreement includes a release signed by Dr. Pierce in favor of the Company (subject to his statutory rights). Pursuant to the Agreement, as Chief Scientific Strategist, Dr. Pierce will provide the Company certain services beginning on June 18, 2016, including reviewing data and advising on the Company’s preclinical and clinical development strategies, providing medical and scientific guidance, fostering relationships with collaborators and key opinion leaders, and serving as the chair of the Company’s Scientific Advisory Board. Dr. Pierce will be compensated for services at a rate of $30,000 per month, plus certain reimbursable expenses. His equity awards will, by their terms, continue to vest during the time he is serving as Chief Scientific Strategist. The term of the Agreement is one (1) year from June 18, 2016 unless the Agreement is (a) terminated earlier by either party in the event of an uncured breach of the Agreement, or (b) terminated earlier by either party for convenience. Under the Agreement, Dr. Pierce is entitled to receive the compensation he would have earned during the remainder of the term if the Agreement terminates due to a breach by the Company or if the Company terminates for convenience.


On December 31, 2014, the Company entered into a lease agreement for approximately 34,000 rentable square feet located at 5820 Nancy Ridge Drive, San Diego, California to serve as the Company’s new corporate headquarters and research and development laboratory. The lease term commenced on October 19, 2015 and expires 120 months after commencement. The Company has an option to extend the lease for an additional five (5) years, if notice is given within 12 months prior to the expiration of the lease term. The Company also has the right to terminate the lease after the expiration of the 84th month after the lease commencement so long as the Company delivers to the landlord a written notice of its election to exercise its termination right no less than 12 months in advance. The lease agreement provides for base rent at $2.65 per rentable square feet, subject to a 3% rate increase on each annual anniversary of the first day of the first full month during the term of the lease agreement. Upon commencement of the lease, 12 months of rent abatement is provided. The Company’s corporate relocation was completed in October 2015 and its research and development lab relocation was completed in November 2015. In addition, the Company is required to share in certain operating expenses of the premises. In December 2014, pursuant to the lease agreement, the Company delivered a security deposit of approximately $90,000.